You don’t know it but you’re doing very well !
The Venezuelan stock market has rocketed up by 200% this year and finds itself sitting atop global stock markets in terms of this exceptional performance. Is this to say that Venezuela is enjoying exceptional growth and that its positive repercussions are being felt by its people? Far from it in reality, since unemployment in Venezuela is reaching 16% of the active population, while the economy has shrunk in the way of 7% this year with an inflation rate of…100%! So. Why in the world has this country’s stock market quadrupled in value this year and doubled in just the last two weeks alone? And how do you explain the regular power cuts, food stores – which are basically empty – overrun with starving customers and the rarefication of basic consumer goods which together make up a grave error for a population which is going through, suffering, the equivalent of a state of war due to stock market euphoria ?
Is it investors from Mars – or from another solar system – who are frantically rushing onto the Venezuelan stock exchange and who are thus provoking its spectacular takeoff? Are they aware of the delightful future prospects for the country’s economy whose growth could be on the verge of an improvement as unexpected is it would be phenomenal. The reality is alas much less inspiring since those who are still in possession of Venezuelan currency prefer to recycle their bolivars on the stock market than to suffer the gigantesque erosion of this currency’s value, having crashed by 80% in a few months. The “investors” – a castigated term which encompasses all of those who still have money in Venezuela – therefore use their stock market as a refuge against monetary depreciation… Don’t be fooled though, because Venezuela is just a caricature of a phenomenon which has taken hold of all stock markets worldwide, which are benefitting – as you well know – from sometimes sumptuous returns.
Stock values are in fact soaring ever higher while our economies stagnate, our unemployment rates worsen and an increased instability is taking its toll within our societies more obviously day after day. It’s what I shall call the great disconnection, or – to be blunt – grand capitalism’s schizophrenia, which is nourishing itself so much so that it has now become improper to talk of the 1%, themselves now at quite a distance from the 0.1%. The Chinese stock market has effectively risen by 50% this year while growth there has slowed to its 2009 rate. And the Italian stock market with unemployment at 13% in the country? Up 25% this year right now! Has the Japanese economy slipped into recession yet again? Long may it hold off because the Nikkei is reaching new heights every day.
Central bankers – who, it is true, have done everything in their powers to save us from the doldrums which high finance had taken us into in the mid 2000s – are well aware that their monetary creation benefits only a handful of happy chosen ones, while the mass 99% are struggling to pick up crumbs. It is true that the problem – almost philosophical in nature – of generating healthy growth, beneficial to all citizens, thanks to monetary policy, greatly surpass their capabilities and their intellectual capacity. Whilst waiting, good people, settle down and watch the circus show, as an onlooker, of stock market appreciations that will never concern you. Because it is actually 30 million Venezuelans who are in the wrong! Yes, the stock market is the economy, and – yes – it is by measuring their takeoffs that it is now possible to conclude that everything is for the best in the best of worlds.